Reasons for Installing charging stations…The Response

So, I asked to be told why we should put charging stations in garages. Read the post here. Jim here, answered:

Years ago I heard the adage, “Never pick a fight with someone who buys ink by the barrel.” Nevertheless, I feel compelled to reply to your January editorial regarding the wisdom of installing EV charging stations.

The reason any parking operator would want to install charging stations can be summed up in one word: inevitability. Whether you believe we have already reached “peak oil” or whether you think it is still many years out, it is indisputable that one day we will run out of oil, and before that happens, it will get much more expensive. Today our nation sends almost $300 billion to countries overseas for oil, and many of these regimes don’t like us very much. We also spend an estimated $83 billion on military protection of oil lines around the world. Unfortunately, no matter how much we drill in this country, our reserves are nowhere near what they need to be in order to be self-sufficient (or cheap). In contrast, any fuel for an electric vehicle is virtually guaranteed to be produced domestically. As a result, there are few actions an American citizen can take that are more patriotic than driving an electric vehicle.

There is also the public health benefit. Regardless of whether you believe in climate change or not, I’ve yet to meet anyone who does not believe that smog and air pollution are real. Despite erroneous media reports, an electric vehicle powered by the dirtiest coal plant in the US is still cleaner than a fossil-fuel powered car when all of the appropriate factors are accounted for. Furthermore, our grid continues to get cleaner every day, while an internal combustion vehicle naturally gets dirtier with age. This means better air and healthier citizens.

But your main point was about the lack of demand in this nascent market. Declaring EVs a failure at this point is no different than a pundit declaring the mobile phone a failure in 1984. It is easy to forget that the first cell phone, released in 1983, cost $3,995, had a 20-minute talk time, and the only feature was that it could hold 30 numbers in memory. There were many critics back then who questioned if anyone would ever waste their money on such a luxury. For a more recent example, a 42” flat screen TV ten years ago cost $10,000. Today you can buy one for 10% of that cost at any big box store. Given the research being performed worldwide on battery technology, there is no reason to think we won’t see the same dynamic for electric vehicles.

Not long ago I read a quote that said, “We think by 2050, roughly 40 percent of those 2 billion cars will be electric.” This was not a quote from the Sierra Club, or even Tesla Motors, but the CEO of Royal Dutch Shell. Every major automaker has an EV either on the road or on the drawing board for release in the next few years.

While battery costs are high today, they will fall sooner rather than later, and battery capacity will increase. As these developments roll out, millions will flock to electric vehicles for both economic and aesthetic reasons. Not only do EVs cost about 10% of the cost per mile to run as gas-powered cars, but there are huge additional maintenance savings (no oil changes, timing belts, etc. over the life of the car adds up). More importantly, however, is the fact that an EV provides a superior driving experience. I spent almost 20 years in the automotive industry and in that time I’ve had the pleasure of driving everything from Corvettes to Ferraris. I have never experienced a bigger thrill behind the wheel than when I finally got to drive a Tesla Roadster this past summer. Even the compact LEAF is a delight to drive. Those of us who have had these experiences know well of what is referred to as the “EV grin.”

In summary, no, there are not many electric cars on the road today, but this will be changing in the not-too-distant future as the market for EVs evolves just like it has for countless electronic devices before them. The big question is whether any individual parking operator is going to be ahead of the curve or behind it. Not every EV driver will have the ability to charge at home (think of NYC or San Francisco), so the workplace or public parking will be the next venues of choice. EV charging will be an additional revenue opportunity for parking operators in the very near future, if not today already.

Jim Burness, Director, Business Development, ClearEnergy Inc.

Jim has all the buzz words and the company line — Everything he says has facts behind it. But let me take his challenge and use up a little ink and bandwidth…

Jim, we are in total agreement. (with the exception of the issue of maintenance, battery replacement, and the like. How much will it cost to replace a burned our motor? Dunno, time will tell on that.) Electric cars are great, and fun, and cheaper to run. There is only one issue. If cars being produced today are in effect hybrids (except the Tesla and the Leaf) they don’t need charging stations. Range anxiety is history, unless you have a totally electric vehicle. Does that make any real sense?

I have friends who own Volts and love them. More power to them. But they don’t need charging stations anywhere except at home. An associate in New York told me he drove his Volt from NYC to Philly and back and never stopped. Great!!!

Explain to me the sense of buying a car that has no on board charger, unless you are a millionaire and can afford a $100,000 vehicle, or unless you drive a very short distance.

Yes, batteries will get better, and cheaper, but we are not, I think, talking about a cell phone or color TV here. We are also not talking about $9 a gallon gasoline, unless the government decides to force the price there.

Cell phones and flat screen TVs were able to make the grade without government intervention and support. $7,500 per vehicle brings the price down to what, $30,000, for a vehicle that is roughly the equivalent of a small Chevy or Toyota. Charging stations cost, what, $20 grand installed and have government subsidy. Is this reasonable — Why do I have to pay for you to install your charger, or buy your Volt, or Tesla. Doesn’t sound like a mass market product to me. But again, what do I know? Jim may be right.

Time will tell. However just consider why someone would pay more for a vehicle that has a limited range, when they could pay the same amount for one that has an on board charger, unlimited range, and get the same quiver up their leg when they stepped on the ‘gas.’

JVH

PS and about all that money we send to the Middle East for Oil. Technology has unleashed a 50-100 year supply of energy right here at home. Pennsylvania, New York, Ohio, Colorado, South Dakota, Alberta and Alaska all have huge supplies of energy. And we have the technology to get it. Now politics may stop that, but its there and its a decision away from putting the Saudis and their pals our of our business.

2 Responses to Reasons for Installing charging stations…The Response

Thanks for the opportunity to respond to your editorial. If I cancan take a bit more of your bandwidth, I’d like to address some of your counterpoints.

1) Virtually all of the original RAV4 EVs from ten years ago are still running around on their original batteries, so longevity is far beyond what was predicted.

2)Pure battery EVs (like the Nissan LEAF) satisfy the daily needs of about 95% of the American commute. It is predicted the most families that have one EV will also have either a conventional car or hybrid for the 5% of the trips that are outside of an EV’s range.

3) You address the problem of government subsidization of both EVs and EV charging stations, but do not address the billions of tax breaks big oil gets. In 2010 I personally paid $156 million more to the IRS than ExxonMobil. We are talking about a playing field that is already inherently not level.

4) All tax incentives targeting EV charging stations expired at the end of 2011.

5) Our company sells the most popular commercial Level 2 charging station and the most common model has a list price of $6,800 plus installation, so about half of what you estimate. As a show of thanks for allowing me to respond in this forum, I’ll give any Parking Today reader 10% off in they mention this blog.

Also, if we expand on Jim’s example of the cell phone in 1983, back then it went for $3,995 and had a 20 minute talk time, but now, 27 yrs later you can get a smart phone for 10% the price and a few more features. If a charging station costs $20k now and can take up to 8hrs to slow charge a vehicle, a parking operator should wait for the learning curve to bring price down and the functionality up. Would you want to be using that 1983 cell phone today?
Seamus Wilmot, UC Berkeley